Shadow Government Statistics (and General Headlines)

• G E N E R A L .. H E A D L I N E S .. 

 

  -- Contrary to happy political and financial media hype, Pandemic-driven U.S. Economic Collapse continues to harden in a protracted non-Recovery, amidst mounting evidence of a renewed Economic Downturn and accelerating Inflation, exacerbated by risks from the still-evolving Russia-Ukraine War and increasingly conflicted FOMC monetary and Administration fiscal activity.

-- Despite recent GDP Benchmark Revisions and current gimmicked reporting, key Economic Series show not only that the Pandemic-driven Economic Collapse was worse than headlined, but also that the still-unfolding Recovery has been much weaker than indicated, again, amidst signals of renewed, faltering activity.

-- Severe Systemic structural damage from the Pandemic-driven Shutdown continues to forestall meaningful Economic Rebound into 2023 or beyond, in context of ever-evolving COVID-19 and related circumstances, and the evolving Russia-Ukraine conflict.

-- The Fed’s planned Balance Sheet Reduction formally began in June and should have begun to relieve some Money Supply pressures on Inflation at that time, in theory, although early hard Money Supply numbers through recently published September 2022 still show nothing of substance. Announced FOMC policies are little more than jawboning and targeted financial-market hype, until put into actual effect. That said, expanded Federal Government Deficit Spending continues, despite political hype to the contrary, helping to accelerate domestic Inflation.

-- With fundamental U.S. Dollar debasement (inflation) intensifying, irrespective of short-lived games with reduced oil prices, holding physical Gold and Silver protects the purchasing power of One’s assets, irrespective of any near-term Central Bank or other precious metals’ price machinations to the contrary.

 

 

Scroll down for the latest ShadowStats Outlook, Headline Economic News and Background Information on the U.S. Economy, Financial System (FOMC), Financial Markets and Alternate Data, also for publicly available Special Reports and contact information.

• L A T E S T .. N U M B E R S [See the later SYSTEMIC RISK SECTION - FEDERAL RESERVE for the latest-published September 2022 Monetary Conditions and current FOMC coverage] – More-specific analysis of the latest economic statistics, headlined earlier in this DAILY UPDATE, begins here with the most-recent data release, followed by others, usually in reverse chronological sequence:

.. EARLY NOVEMBER 2022 CONSUMER SENTIMENT – Early November Consumer Sentiment deepened to a 45.8% (-45.8%) shortfall, previously 40.7% (-40.7%) in October, in recovering pre-Pandemic levels. The University of Michigan’s Early November 2022 “Consumer Sentiment fell about 9% below October, erasing about half of the gains that had been recorded since the historic low in June.” (November 11th, go to http://www.sca.isr.umich.edu for details).

(November 10th) OCTOBER 2022 CONSUMER PRICE INDEX – October 2022 headline CPI-U inflation gained 7.45% unadjusted year-to-year, down from 8.20% in September and from its 9.06% near-term peak in June, but outside the current near-term Pandemic circumstance that annual inflation is the worst in 40-plus years, since February 2022 (Bureau of Labor Statistics - BLS). On a month-to-month basis, October CPI-U inflation gained a seasonally adjusted 0.44%, following gains of 0.39% in September and 0.12% in August and, and a 0.02% (-0.02%) decline in July. Such reflected monthly October Food inflation of 0.60%, versus 0.78% in September, 0.79% in August and 1.10% in July. Dominated by a 3.99% monthly jump in Gasoline prices, following three months of collapse, Energy inflation gained 1.80% October, having declined by 2.11% (-2.11%) in September, by 5.02% (-5.02%) in August and by 4.56% (-4.56%) in July. “Core” Inflation (ex-Food and Energy) gained 0.7% in October, 0.58% in September 2022,0.57% in August and 0.31% in July.

Beyond the varying impact of volatile gasoline prices, headline October inflation numbers continued in context of soaring inflation, triggered by the Pandemic-related explosive growth in the Federal Reserve’s Money Supply creation and in the Federal Government’s Deficit Spending and related Federal Debt Expansion. The Inflation still is not being driven by the FOMC’s hypothetical economic boom.

 

SHADOWSTATS DAILY UPDATE –- November 11th to 15th [Updated November 11th, 12:10 p.m. ET]. -– IN THE NEWS: No economic rebound/ recovery here: Early November 2022 Consumer Sentiment [University of Michigan] plunged anew, shy by a deepening 45.8% (-45.8%) of ever recovering its pre-Pandemic peak level. Headline October 2022 CPI-U year-to-year inflation eased to 7.75% in October 2022, from 8.20% in September, with the ShadowStats Alternate CPI easing to 15.9% in October from 16.4% in September, despite some rebound in gasoline prices. Although off near-term peak in the post-Pandemic cycle, those current year-to-year inflation rates otherwise remain at respective 42-year and 75-year highs.

Based on last month’s Third-Quarter 2022 CPI-W inflation, the 2022 Social Security Cost of Living Adjustment (COLA) headline increase was set at 8.7% for payments beginning January 2023; per the ShadowStats alternate inflation estimate, it would have been 17.0%, if the CPI-W calculations had not been redefined following the CPI Inflation and COLA spikes of 1980/ 1981. Headline CPI-U year-to-year inflation in September 2022, which tends to run lower than the CPI-W over time, was up year-to-year in the month (not quarter) by 8.2%, versus 8.3% in August, versus ShadowStats Alternate estimates of 16.4% in September, down from 16.5% August.

Following three straight months through September, of both CPI and PPI headline annual inflation being depressed temporarily by weaker gasoline and energy prices from what then was continuing depletion of the Strategic Petroleum Reserve, October 2022 CPI monthly gasoline and aggregate energy inflation turned positive for the first time in four months, with gasoline up by 4.0% in the month, having dropped by 21.5% (-21.5%) in the prior three months. October PPI reporting on November 15th likely will show similar patterns in its Finished Goods sector.

–- DEPLETION OF STRATEGIC PETROLEUM RESERVE GETS CREDIT FOR RECENT HEADLINE GDP GROWTH (as reviewed November 5th). Well timed in advance of the Mid-Term Elections, the Administration’s massive release of petroleum and heavy depletion of the U.S. Strategic Petroleum Reserve not only temporarily softened excessively high inflation (gasoline prices) into headline September reporting, but it also narrowed the U.S. Trade Deficit, given largely unadvertised exports of related oil, which, along with artificially depressed inflation, helped to generate a temporary boost to Third-Quarter 2022 GDP.

Headline October 2022 Unemployment Rate U.3 deteriorated to 3.7%, from 3.5% in September, reflecting a rising count of unemployed against a continuing and unusual shrinkage of the headline Labor Force (employed plus unemployed). Payroll Employment rose by 261,000 in the month, within the expected range, having recovered its Pre-Pandemic Peak in August, gaining against, but still shy by about 5.6 million jobs of what would have been the normal level of payroll activity expected, at present, without the Pandemic. That suggests the system is about three years shy of full recovery.

Federal Reserve Board (FRB) policies remained in place at the November 2022 Federal Open Market Committee Meeting (November 2nd FOMC Statement and Press Conference), along with an otherwise anticipated 75-basis point (0.75%) rate hike in the Federal Funds Rate. While higher rates continue to hit the Economy hard, contrary to FOMC hype, they do little to constrain current Inflation. Headline economic activity is moribund, not overheating, and it is not driving the inflation. Instead, reflecting extreme FRB money creation and consumer flight to liquidity, inflation-driving Money Supply growth in the most liquid measure of “Basic M1” (Currency plus Checking Accounts) has received the equivalent of 21 years of Monetary Stimulus in the 31 months (2.6 years) since the March 2020 Pandemic Shutdown. Under current FRB/ FOMC policies, headline economic activity should continue to falter, and inflation should continue to soar (expanded economic specifics are detailed in the later OPENING HEADLINE and LATEST NUMBERS Sections).

Consider from the FOMC Statement [separately see the ShadowStats comment on the Administration’s recent manipulations] that, “Recent indicators point to modest growth in spending and production. Job gains have been robust in recent months, and the unemployment rate has remained low.” Yet, that “robust” headline Payroll Employment just minimally recovered its Pre-Pandemic level two months ago, in headline August 2022 reporting. Consider that in normal economic times [no Pandemic], Payroll Employment currently would be running higher by about 5,600,000 jobs than seen at present. Separately, the broader Unemployment Rate U.6 already has defined out of existence, a large number of “discouraged workers,” who lost their jobs during the Pandemic, and who are not looking for work, at present, because they believe there are no jobs to be had.

Happy FOMC economic musings aside, consistent with a contracting domestic economy, the November 1st estimate of Third-Quarter 2022 Real Construction Spending continued in deepening annual collapse for the fourth straight quarter, down by 10.0% (-10.0%) year-to-year, and down at an annualized quarterly pace of 16.. . 7% (-16.7%), which was the fourth quarter-to-quarter contraction in the last five quarters. . .

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